What is the Poverty Industry in Japan?

Poverty Industry image

In today's society, there exists a dark underbelly known as the poverty industry, where unscrupulous individuals and organizations take advantage of the weaknesses of those in poverty to turn a profit.

This phenomenon also referred to as "貧困ビジネス" or "poverty business" in Japanese, has gained significant attention, particularly in Japan.

While masquerading as social enterprises or organizations focused on poverty alleviation, these entities actually perpetuate and profit from the cycle of poverty without contributing to the upliftment of those in need.

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The Landscape of Poverty Business in Japan

The poverty business in Japan encompasses a wide range of sectors and industries, all aimed at extracting profits from economically disadvantaged individuals and social outcasts.

These include internet cafes, live-in workers, dispatched employees, zero-zero properties, low-cost accommodations, consumer finance, and even illegal money lending.

It is through these exploitative practices that these businesses thrive, trapping individuals in a perpetual state of poverty without offering any real solutions or opportunities for escape.

One of the pioneers in highlighting the concept of poverty business is Makoto Yūasa, the secretary-general of the non-profit organization "Self-Sufficiency Support Center Moyai."

He coined the term to emphasize that the problem lies not only in the illegal activities involved but also in the inhumane systems that perpetuate poverty among the affected individuals.

According to Yūasa, it is essential to address the poverty business as a whole rather than discussing individual cases.

He argues that this is necessary due to several reasons, which include the following:

  1. Poverty business primarily targets individuals who fall below the minimum living standard guaranteed by the safety net.
  2. These businesses continuously create business models that benefit only the profit-seeking entities, often through illegal or unethical means.
  3. The victims of poverty business often lack information and are unaware of their rights and options due to educational and systemic deficiencies.

The Elements of Poverty Business

To understand the workings of poverty business, it is vital to identify its key components.

These elements contribute to the perpetuation of poverty and the exploitation of vulnerable individuals.

Targeting the Safety Net's Threshold

Poverty business primarily focuses on individuals living below the minimum living standard guaranteed by the safety net.

This safety net represents the right to a minimum standard of living, as enshrined in Article 25 of the Japanese Constitution.

However, for poverty businesses to thrive and expand their profits, the lowering of this minimum living standard becomes an inevitable consequence.

Exploitative Business Models

Businesses engaged in poverty business continually develop models that solely benefit the profit-seeking entities.

These models often involve illegal or unethical practices, taking advantage of the vulnerable position of individuals in poverty.

Exploitation thrives as these businesses create a system that maximizes their gains at the expense of their customers.

Preying on Ignorance and Isolation

The victims of poverty business are often isolated and unaware of their rights and options.

This isolation stems from various factors, including limited education, lack of access to necessary information, and social exclusion.

Exploitative entities capitalize on this lack of knowledge and use it to their advantage, trapping individuals in cycles of poverty.

Major Examples of Poverty Business

Poverty business encompasses a wide range of industries and practices, extending beyond the typical examples.

Here are some notable sectors where the poverty business thrives.

Exploitation in Labor Relations

Within the labor sector, poverty business manifests in various forms, such as dispatched work and labor outsourcing.

The Dark Side of Outsourcing

One form of poverty business is known as "業務請負" or labor outsourcing.

It involves a subcontracting company, operating under a civil law contract, taking on tasks such as manufacturing, logistics, sales, and administration for a client company.

These subcontracting companies often employ individuals under different employment terms and conditions, resulting in lower wages compared to regular employees.

This practice creates a vulnerable segment known as "請負社員" or dispatched workers, who are more susceptible to becoming part of the working poor.

The Plight of Dispatched Workers

Another example of poverty business is the labor dispatch industry, where companies provide workers on a temporary basis.

Some argue that dispatched labor is an unavoidable consequence of the labor dispatch law that was enacted in Japan in the 1990s.

It has led to the rise of registration-based day labor, where workers face unstable employment conditions and receive lower incomes and limited social security benefits compared to regular employees.

The exploitation of dispatched workers often involves illegal practices, such as pre-screening interviews by client companies and the normalization of labor subcontracting and multiple dispatching.

These practices result in deteriorating employment conditions and economic circumstances for the workers involved.

The Impact of Poverty on Business

The pervasive nature of poverty business has significant implications for society as a whole.

It perpetuates poverty, exacerbates income inequality, and hinders social mobility.

The profit-seeking entities involved often manipulate vulnerable individuals, trapping them in cycles of poverty and depriving them of the opportunity to improve their lives.

Furthermore, poverty business undermines the efforts of genuine social enterprises and organizations striving to address poverty and related social issues.

By exploiting the vulnerabilities of those in need, poverty business operates in direct opposition to the principles of social contribution and problem-solving inherent in true social enterprises.

Combating Poverty Business

To combat poverty business, it is crucial to raise awareness about its existence and the harm it inflicts on vulnerable individuals and society at large.

Education and information dissemination play a vital role in empowering individuals and enabling them to make informed decisions.

Additionally, stricter regulations and enforcement are needed to curb exploitative practices and hold those involved in poverty business accountable.

Efforts must also focus on strengthening the social safety net to ensure that individuals in poverty have access to the necessary support and resources.

This includes providing proper education and training, improving labor conditions, and creating opportunities for upward social mobility.


The poverty industry, or poverty business, represents a dark side of society where profit is prioritized over the well-being of vulnerable individuals.

Exploitative practices in various sectors perpetuate the cycle of poverty and hinder social progress.

Raising awareness, implementing stricter regulations, and strengthening the social safety net are essential steps toward combating poverty business and creating a more equitable society.

By addressing the root causes of poverty and providing genuine avenues for upliftment, we can work towards breaking the chains of poverty and offering individuals the opportunity for a brighter future.

It is only through collective efforts and a commitment to social justice that we can create a society where exploitation and poverty business have no place.

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